Minneapolis Fed, Report: A Ramsey Theory of Financial Distortions
“Within the context of a Ramsey model of capital taxation, we identified a force that operates as in Sargent and Wallace (1982) and pushes the government to increase its indebtedness to mitigate frictions in private asset markets. We showed that when it is impossible to completely undo those frictions in the long run, it is…
Read MoreDallas Fed, Report: Threat of Global Housing Slide Looms Amid Rising Rates
“Housing froth has reemerged since 2020, with signs of a pandemic housing boom extending beyond the U.S. to other, mostly advanced, economies. While house-price growth has recently begun to moderate—or, in some countries, to decline—the risk of a deep global housing slide persists.” “Specifically, the perils detected in the U.S. and German housing markets pose a vulnerability…
Read MoreAustan Goolsbee, Speech: The Need for a Ground-Level View of the Economy
Monetary policy was not discussed. General Economic Comment “No doubt there will be bumps in the road to come. It’s a strange and unprecedented moment coming out of the pandemic. Lots of things in the economy got turned on their heads, and we need to figure out where they will land and what that means…
Read MoreFed Unfiltered, Daily Trends: Tables (2/28/23)
Fed Unfiltered, Annotated Graphs: Inflation (3 Metrics)
St. Louis Fed, Report: Navigating the Waves of Global Shipping, Drivers and Aggregate Implications
“This paper studies the determinants and aggregate implications of global shipping dynamics. Motivated by salient features of the dynamics of global shipping that we document, we develop a multi-country dynamic model of international trade with endogenous global shipping supply. We find that the model can account for salient features of global shipping dynamics. In particular,…
Read MoreSF Fed, Report: The Role of Immigration in U.S. Labor Market Tightness
“Immigration policies enacted after January 2017 contributed to the decline in immigration prior to the sharp drop due to the COVID-19 border closures. Lower net international migration led to a slowdown in the foreign-born population and labor force growth. This contributed to the tightening in the U.S. labor market. Reopening of borders in 2022 and…
Read MoreRaphael Bostic, Speech: Racial Inequality in Macroeconomic Conference
Monetary Policy was not covered in this speech. Transcription is not available. ———-
Read MoreFed Unfiltered, Daily Trends: Tables (2/27/23)
Philip Jefferson, Speech: Recent Inflation and the Dual Mandate
Inflation “In summary, core goods inflation has started to come down. Several indicators suggest that housing services inflation is likely to come down in the coming months. There is more uncertainty surrounding inflation in core services excluding housing. Over time, we’ll learn more about inflation dynamics in this sector.” “Often, the FOMC must balance competing…
Read MoreNY Fed, Report: Market-Function Asset Purchases
“Official-sector interventions to restore the functionality of government bond markets will occasionally be necessary. At the 2021 U.S. Treasury Market Conference, John C. Williams, President and CEO of the Federal Bank of New York, observed that “…two lessons are clear. First, the unforeseeable and unpredictable will happen, and can result in significant stresses in the…
Read MoreNY Fed, Report: Noncognitive Skills at the Time of COVID-19, An Experiment with Professional Traders and Students
“We have studied whether the COVID-19 pandemic has impacted noncognitive skills in a sample of professional traders and, for comparison purposes, in a sample of students. We have found a significant effect of the pandemic on professional traders’ Agreeableness and Locus of Control (and, to a lower extent, Grit), and on students’ Conscientiousness. Overall, our…
Read MoreNY Fed, Report: Workers’ Perceptions of Earnings Growth and Employment Risk
“In this paper we examine workers’ beliefs about their earnings growth and risk of layoff and quitting. While there exists a large body of work on observed earnings and employment volatility, little is known about worker’s perceptions of that variability. Knowledge of such beliefs, and how they evolve over the working life and business cycle…
Read MoreFed Unfiltered, Weekly Report: 2/27/23
Quick Overview Amidst all the uncertainty, one thing is certain – the Fed Funds rate is going up. A few weeks ago, Jerome Powell mentioned how the disinflationary process (increasing rates to lower inflation) is “probably going to be bumpy”. Since that comment was made …
Read MoreFed Unfiltered, Annotated Graphs: Fed Funds and 3-Month T-Bill
Fed Unfiltered, Annotated Graphs: Balance Sheet
Loretta Mester, Interview: WSJ Print
Monetary Policy Lags “I’ve heard some people say the lags have shortened. I don’t think there’s anything definitive that we can point to because, remember, there wasn’t anything definitive about exactly what the lag was.” Inflation “It’s always a risk management exercise. There’s not going to be like, “Oh, we know that stopping now is…
Read MoreLoretta Mester, Speech: Comments on “Managing Disinflation”,
Recession “But even within the forum paper itself there is a tension between the estimated Phillips curve findings and the historical analysis presented in Section 2. The historical analysis documents that the vast majority of disinflations in the U.S. and in other advanced economies have been accompanied by recessions, a finding that differs from the…
Read MoreIMF, Report: Assessing the Impact of Supply Disruptions on the Global Pandemic Recovery
“We used two novel approaches to estimating the impact of supply disruptions in 2021 on global output and inflation. In all, we estimate that supply shocks weighted negatively on the global recovery and contributed positively to global core inflation. The impact on the level of global GDP ranges from between 0.5 percent and 1.2 percent,…
Read MoreLoretta Mester, Interview: CNBC (print only, excerpts below)
Fed Funds “I see that we’re going to have to bring interest rates above 5%. We’ll figure out how much above. That’s going to depend on how the economy evolves over time. But I do think we have to be somewhat above 5% and hold there for a time in order to get inflation on…
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